Buy SBI Life Insurance; target of Rs 846: HDFC Securities

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26 Aug, 2025 12:21

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HDFC Securities's research report on SBI Life Insurance

SBI  Life’s  1QFY19  total  APE grew just 2.1% YoY to Rs 13.1bn. Growth was lower  also due to the high base in 1QFY18 where APEs grew 50%+. Protection share  on APE basis reduced to just 4.6% (-480 bps YoY and -80bps vs. FY18) partly  as  a  result  of  move  to single premium credit life policies and partly  as  a  result  of  lower (-63% YoY) group term business. For 1QFY19 SBILIFE for the first time reported tax rate adj. VNB margins at 19.0%.

Outlook

We continue to like SBI Life  due to strong distribution footprint of its parent SBI, lowest operating  cost ratios in the industry, and tailwinds from financialisation of  savings.  We maintain  BUY  with a TP of Rs 846 (FY20 EV + 27.3x FY20E VNB).

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